Liberal Democrats pledge higher tax allowance

In their latest manifesto plans, the Liberal Democrat party have suggested raising the income tax personal allowance to £12,500.

In addition, they would also seek to increase the amount earned before an individual has to pay National Insurance.

Danny Alexander, chief secretary to the Treasury, said: ‘It was on the front page of the 2010 Liberal Democrat manifesto and we have fought to keep it on the agenda at every budget. By April next year we will have delivered a tax cut to over 26 million people worth £800 a year to a typical basic rate taxpayer and taken over three million out of tax altogether. Now we want to go even further’.

He added: ‘By cutting tax in this Parliament, cutting tax further in the next Parliament, and then moving on to National Insurance, we can make sure that over the course of a decade we shift the balance in the tax system – a generational shift – to help people in work’.